The Group Managing Director of First City Monument Bank (FCMB) Limited, a subsidiary of, FCMB Group Plc, Mr. Ladi Balogun has assured stakeholders that the bank would sustain its impressive performance of the half year ended June 30, 2016.
FCMB Group Plc reported a profit before tax (PBT) of N16.3 billion, showing an increase of 70 per cent from N9.6 billion recorded in the corresponding period of 2015. FCMB Group Plc – which consists of First City Monument Bank (FCMB) Limited, FCMB Capital Markets Limited, CSL Stockbrokers Limited and CSL Trustees Limited, partly attributed the development to foreign exchange revaluation gains, following the recent implementation of the flexible exchange rate policy by the Central Bank of Nigeria (CBN).
Speaking on the performance of the bank, Balogun said although loan impairments will remain elevated in the second half of the year, the bank will cushion that risk with continued momentum in revenues and efficiency gains from cost optimisation measures taken earlier in the year.
FCMB Group Plc’s gross revenue for the six months increased by 14 per cent to N88.3 billion, compared to N77.4 billion for the same period in the previous year. Non-Interest Income surged by 110 per cent to N26.0 billion, up from N12.4 billion recorded in 2015.
Customer confidence in FCMB remained strong, as deposits were up five quarter-on quarter (QoQ) to N689.4 billion in June 2016, compared to N657.2 billion at the end of the first quarter of 2016. Total assets increased by 13 per cent QoQ to N1.3 trillion in June 2016 versus N1.1 trillion in March 2016. The Group’s loans and advances also grew by 17 per cent QoQ to N657.0 billion in June 2016, compared to N561.6 billion at the end of Q1 2016.
In his comments, Balogun said: “The bank witnessed improved operating performance in spite of the multiple challenges faced by the economy and banking sector. The most significant driver of earnings growth was the N9.1billion exchange gains from our dollar balance sheet. In addition our personal and SME banking segments have exhibited resilient profit growth (in excess of 442 per cent or N7.4 billion, year on year) driven by electronic banking revenue and strong customer acquisition, now at 60,000 a month.”
According to him, greater cost discipline has also resulted in improved operating efficiency.
“Performance was otherwise dampened by a YoY increase of N9.2 billion provisions for non-performing loans and other known losses. We expect that loan impairments will remain elevated in the second half of the year but will be cushioned by continued momentum in revenues and efficiency gains from cost optimisation measures taken earlier in the year,” he said.